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Families are reminded that they may be able to claim for tax-free childcare costs to help pay for breakfast and after school clubs as children go back to school.

In a recent press release HMRC confirmed that Eligible families can save money on their childcare and benefit from a government top-up worth up to £2,000 every year, or up to £4,000 a year if a child is disabled. In June 2021, about 308,000 families across the UK benefited from using Tax-Free Childcare, but thousands are missing out on this opportunity.

Tax-Free Childcare is available to parents or carers who have children aged up to 11, or 17 if their child is disabled. For every £8 a parent or carer deposits into their account, they will receive a £2 top-up, up to the value of £500 every three months, or £1,000 if their child is disabled.

HMRC recognises that families’ personal circumstances have changed since March 2020 as more parents and carers are preparing to return to their workplaces. The 20% top-up is paid into the Tax-Free Childcare account and is ready to use almost instantly, meaning parents and carers can use the money towards the cost of childminders, breakfast and after school clubs, and approved play schemes.

Tax-Free Childcare is also available for pre-school aged children attending nurseries, childminders or other accredited childcare providers. Parents and carers, who are returning to work after parental leave, can apply for a Tax-Free Childcare account for that child before they need to start using it. Families can start depositing money 31 days before they return to work, maximising the potential government top-up saving.

Childcare providers can also sign up for a childcare provider account via GOV.UK to receive payments from parents and carers via the scheme.

Each eligible child requires their own Tax-Free Childcare account. If families have more than one eligible child, they will need to register an account for each child. The 20% government top-up is then applied to deposits made for each child, not household.

Account holders must confirm their details are up to date every 3 months to continue receiving the government top-up.

A government-funded Peer Networks scheme is offering support to small and medium-sized enterprises (SMEs) across the UK.

The programme, which is free to join, helps organisations tackle common business challenges through interactive action learning.

Additionally, the scheme’s trained mentors help small and medium-sized businesses handle new opportunities and build a strong support network.

Business leaders can learn from like-minded individuals on the scheme and put practical solutions into place together to overcome common issues.

Virtual workshops on the Peer Network scheme normally take place in small group sessions, but one to one mentoring and coaching is also available.

Trained facilitators are always on hand to help organisations develop and grow.

Head of Operations at Mastercall Healthcare said: “The one-to-one tutor session really helped me work on some long-standing obstacles.

“I’m so glad to have taken part and feel more confident in my own skills and attributes.”

SME leaders on the scheme can share their business concerns with fellow company owners who experience the same challenges.

Jason Thorpe, Managing Director at The Voiceover Gallery said: “By sharing experiences and issues, it enables you to step back from business, and look at things from a different perspective whilst benefitting from the experience of others that may have faced similar challenges.”

Founder and CEO at Datacentreplus, Mashukul Hoque said: “Engaging with other businesses through Peer Networks has been an invaluable experience for me.

“There is a lot to learn from other businesses, particularly in these challenging times.”

He added: “It is an opportunity to share ideas, tips and good practice that others can benefit from as well.”

Any SMEs that have been in business for at least 12 months, employ five or more staff members and make £100,000 or more in revenue can join the scheme.

The programme, which has been created by the Department for Business, Energy and Industrial Strategy, is held at local growth hubs across the UK.

 

 

News broke in recent days that McDonalds were running out of supplies. As a direct result of these supply chain issues their iconic milk shakes are being dropped from menus together with other bottled drinks. These particular shortages will apply to outlets in England, Scotland and Wales. Supplies in Northern Ireland are holding up, so far…

Is this further evidence that the delivery driver shortage is affecting retailers’ ability to supply goods to consumers?

According to the Road Hauliers Association, 30,000 HGV driving tests were unable to proceed last year and that the driver shortage was exacerbated by changes to the rules following Brexit.

Price inflation

One consequence of supply shortages – aside from goods being unavailable – is that if demand remains high, but in limited supply, prices tend to rise. Witness the incredible price rises in basic building materials in recent months.

If these trends continue and prices for commodities start to rise inflation will rear its head.

The Bank of England are forecasting inflation at almost 4% at the start of next year. It will not require much in advance of this figure before the bank will need to increase interest rates in an attempt to take the heat out of future price increases.

It is difficult to see how these fiscal measures will impact McDonalds and many other retailers if their problem is delivery difficulties, not money supply.

 

What to do?

If your business is being affected by delivery problems you will be sympathetic to McDonalds’ plight.

Aside from the physical need to get goods delivered, affected businesses could consider increasing stocking levels in affected goods, if this is feasible. And then triggering reorder levels at an earlier point in the production process.

This would have the added advantage of buying at lower prices for longer production runs and keeping manufacturing costs down.

The difficulty is that firms are stripped of working capital in the past eighteen months and may be unable to find additional funding or storage space.

We may have to content ourselves with a brew to accompany our next take out. Unfortunately, the driver shortage may take longer to resolve as drivers point to bad working conditions and low pay as further issues facing their industry.

‘She only makes the tea’ and ‘my employees are on standby’ are just some of the strange excuses used by businesses who have paid their workers under the National Minimum Wage, the UK tax office has revealed.

Every employed worker in Great Britain is legally entitled to the National Minimum Wage, but many employers tried cheating the pay system during the last financial year, according to a new Government report.

HM Revenue and Customs (HMRC) has released the most shameful excuses that employers have used for failing to pay their employees correctly, including ‘my workers like to think as themselves as being self-employed’ and ‘young workers have to prove their worth in the first three months’.

One company claimed their employee is ‘still learning so they are not entitled to minimum wage’, while another thought ‘the National Minimum Wage does not apply to their business’.

Other outrageous excuses for not paying employees the legal minimum wage include: ‘She only sweeps the floors’, ‘they weren’t a good worker’ and ‘I thought it was okay to pay young workers less if they are not British’.

During the last tax year, HMRC assisted around 155,000 ‘short-changed’ employees in the UK to retrieve more than £16 million which was owed to them. In addition, they also distributed more than £14 million in fines.

The Director of Individuals and Small Business Compliance, HMRC, Steve Timewell said: “The majority of UK employers pay their workers at least the National Minimum Wage, but this list shows some of the excuses provided to our enforcement officers by less scrupulous businesses.

“Being underpaid is no joke for workers, so we always apply the law and take action. Workers cannot be asked or told to sign away their rights.”

He added: “We are making sure that workers are being paid what they are entitled to and, as the economy reopens, reminding employers of the rules and the help that is available to them.

The national minimum wage differs for each individual as it is dependent on an employer’s age and experience, with under 23s receiving a lower rate than those older than 23.

The current hourly rates are:

• £8.91 – Age 23 or over
• £8.36 – Age 21 to 22
• £6.56 – Age 18 to 20
• £4.62 – Age under 18
• £4.30 – Apprentice

As part of the government’s plan to bounce back from the pandemic, HMRC is encouraging employees to regularly monitor their pay, cash deductions and any unpaid working time.

To find out more about the National Minimum Wage, click here.

As most drivers of a company car will be aware, if you have any private use of the vehicle this will result in a significant Income Tax charge. The benefit charge is the way that HMRC levy tax on this benefit in kind; and the higher the CO2 footprint of your company car, the higher the Income Tax charge.

Which is why many company car drivers are now looking at electric vehicles – either plug-ins or self-charging hybrids – as a tax efficient alternative.

For example, if you presently drive a gas-guzzling petrol driven car with a CO2 rating of 145g/km you could drastically reduce your benefit in kind tax charge by switching to a hybrid or fully electric car with a CO2 rating as low as 0g/km. There would still be a tax charge, even at 0g/km, but it would be based on a minimum 1% of the list price of the car when new, rather than 33% if rated at 145g/km.

Company car drivers whose private fuel is paid for by their employer will pay an additional Income Tax charge based on the Car Fuel Benefit charge. This charge is calculated by applying the above percentage rate (33% in our example above) to a fixed figure, £24,600 for 2021-22. Accordingly, the Car Fuel Benefit charge added to the driver’s taxable income would be £8,118.

Interestingly, since 6 April 2018, there is no taxable car fuel benefit where electricity is provided for an electric car. Legislation was included in the Finance Act 2019 with retrospective effect where the recharge facilities are made available to all employees at the workplace.

If an employee recharges a company vehicle at home and is then reimbursed for the cost of the electricity used, this may be challenged as earnings. However, the employee could then make a claim for the electric cost using the advisory rates. Currently this is 4p per mile for fully electric cars.

A final point, employers would also benefit from a shift to an all-electric company car fleet. They are obliged to pay a 13.8% National Insurance charge on the total value of benefits provided (car and car fuel benefits); in which case converting to electric would be an additional bonus.

In a recent news story published on the GOV.UK website, HMRC confirmed that nearly 1.8 million married couples and those in civil partnerships are claiming the Marriage Allowance to save up to £252 a year in Income Tax.

The allowance enables married couples or those in civil partnerships to share their personal tax allowances if one partner earns an income under their Personal Allowance threshold of £12,570 and the other is a basic rate taxpayer.

They can transfer 10% of their tax-free allowance to their partner, which is £1,260 in the 2021-22 tax year. It means couples can reduce the tax they pay by up to £252 a year. Couples can also backdate their claims for any of the four previous tax years, which could be worth up to £1,220.

If you are eligible, and still not making a claim, you can complete an application online at https://www.gov.uk/apply-marriage-allowance.

Almost three million people have moved off the furlough scheme since March as the economy began to bounce back and businesses reopened, according to new statistics.

This is unsurprising as employers are now expected to cover 20% of any hours not worked with government providing 60%.

It will be sobering to see how the final closing of the furlough scheme on 30 September will affect unemployment rates.

Readers who are still undecided how to respond to these changes will need to make possibly agonising decisions in the coming month.

We can help. Please call so we can help you consider your options.

If you do not pay your tax bill on time and cannot make an alternative arrangement to pay, HMRC can take ‘enforcement action’ to recover any tax you owe.

You can usually avoid enforcement action by contacting HMRC as soon as you know you have missed a tax payment or cannot pay on time.

They may agree to let you pay what you owe in instalments, or give you more time to pay.

Otherwise, there are a number of enforcement actions HMRC can take to get the tax you owe. They can:

• collect what you owe through your earnings or pension
• ask debt collection agencies to collect the money
• take things you own and sell them (if you live in England, Wales or Northern Ireland)
• take money directly from your bank account or building society (if you live in England, Wales or Northern Ireland)
• take you to court
• make you bankrupt
• close down your business

If you do not pay your tax on time, you’ll probably have to pay interest on the outstanding amount. You may also have to pay a penalty or surcharge.

1 September 2021 – Due date for Corporation Tax due for the year ended 30 November 2020.

19 September 2021 – PAYE and NIC deductions due for month ended 5 September 2021. (If you pay your tax electronically the due date is 22 September 2021)

19 September 2021 – Filing deadline for the CIS300 monthly return for the month ended 5 September 2021.

19 September 2021 – CIS tax deducted for the month ended 5 September 2021 is payable by today.

1 October 2021 – Due date for Corporation Tax due for the year ended 31 December 2020.

19 October 2021 – PAYE and NIC deductions due for month ended 5 October 2021. (If you pay your tax electronically the due date is 22 October 2021.)

19 October 2021 – Filing deadline for the CIS300 monthly return for the month ended 5 October 2021.

19 October 2021 – CIS tax deducted for the month ended 5 October 2021 is payable by today.

31 October 2021 – Latest date you can file a paper version of your 2021 self-assessment tax return.

In a recent press release the government announced that more of the country’s leading businesses from a variety of industries have pledged their support for the UK’s world-leading COVID-19 vaccination programme by offering incentives to vaccinated customers.

Asda, lastminute.com, National Express, FREE NOW taxis and Better leisure centres will be offering discounts to people who get a COVID-19 vaccine, joining the national effort to protect the country as it continues its cautious return to normality.

The companies will be joining Uber, Bolt and Deliveroo, which committed last month to backing the vaccination programme by providing exclusive offers to those who have received a jab.

The new businesses and rewards will include:

• Asda – will offer £10 vouchers for their clothing brand George to 18- to 30-year-olds who spend over £20. These will be offered at the vaccine pop-up clinics located in Old Kent Road in London, Watford & Birmingham;
• lastminute.com – will offer over-18s £30 gift cards towards holidays abroad to all young people getting vaccinated through their website;
• Better leisure centres – will offer over 16s a £10 voucher to use on any Better membership and a free three-day pass at any of their 235 leisure facilities across the UK;
• FREE NOW – will provide up to £1 million in free taxi rides for over-18s attending their vaccine appointment each way from today [Sunday 15 August] until the end of September; and
• National Express Buses (Midlands) – will offer 1,000 people 5-day unlimited travel saver tickets which can be used within 90 days. Tickets can be claimed by sharing vaccine booking references in the company’s app.

Deliveroo has also revealed further details of their support, which will include thousands of £5 vouchers to those who get the vaccine, distributed in the coming weeks. Bolt will be offering £10 vouchers for 10,000 rides from next week in Birmingham and Leicester, and Uber will be announcing further details shortly around their drive to help students get vaccinated ahead of term time.